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Friday, June 17, 2011

CBC: "Value for Money" = Deepening Commercial Values

According to the Canadian Press, "the CBC released a study Wednesday (June 15) that pegs their gross impact on the Canadian economy last year at $3.7-billion. The analysis by consultants Deloitte & Touche LLP was commissioned by the public broadcaster in connection with their latest five-year strategic plan."

The goal of the study, according to CBC President Hubert Lacroix is to show that for every dollar the public broadcaster receives from the government, it generates another $3 in related economic activity.

This study was commissioned in anticipation of license renewal hearing before the Canadian regulator, the CRTC. D & L concludes that the CBC presence is actually good for other commercial sectors, saying it can operate as a beta site by developing new technologies and promoting digital content, especially in the Montreal area.

That's the good news.

The problem with the study is that it presumes that the values of the commercial sector now apply completely to the public broadcaster as well.

This puts the CBC on very perilous ground. By establishing commercial benchmarks against which it will henceforth be judged, the CBC must now prove itself to be an undoubted commercial success. And that can only mean more programming that imitates the commercial sector and fewer programs that don't.

But if the CBC falters due to a shaky economy, or is forced to implement a vigorous round of cost-cutting from the now emboldened Conservative government, the CBC-haters will point to this study and accuse the public broadcaster of failing, based on its own standards of commercial viability.

Despite this study, members of the Tory caucus such as Jason Kenney are still accusing the CBC of being profligate and Toronto-centric.

Interestingly, the BBC also commissioned Deloitte & Touche a few months ago which also came up with almost exactly the same conclusions that the BBC is value for money. That study also unleashed attacks from the Tory ranks, accusing the BBC of being "south-east centric."

The BBC will retaliate against cuts in its budget this week by claiming that its contribution to Britain's economy grew 5.6% to top £8bn last year, delivering well over £2 of value for every pound in fees from television licences.

As the former Conservative minister Lord Patten prepares to take the chair of the corporation, the BBC will step up its efforts to justify the licence fee, arguing that far from being a drain on taxpayers, its activities in commissioning programmes, buying services and supporting creative activities act as a net positive for the nation's finances.

A study by the accounting firm Deloitte will conclude that the BBC's UK activities generated £8.1bn of economic value in the last financial year, up from £7.7bn the previous year. And its "net" contribution – taking account of a simulation of activity that would replace the BBC if licence fees were scrapped – has grown to £5bn, up 14.9% compared with the results of similar research a year ago. Licence fee income is around £3.6bn per year.

In spite of efforts to broaden activities away from the south-east, the BBC remains highly London-centric – Deloitte found that 69% of the BBC's gross economic contribution remained in the capital, although benefit to Scotland, Wales and Northern Ireland all increased. The BBC is trying to reduce its south-eastern focus: by 2016, half of network TV programmes and 40% of radio spending are due to be made outside London, partly through a move of five departments to Salford.

As the BBC and the CBC move away from their public broadcasting mandates, they may discover that being commercial cross-dressers will guarantee them neither love nor money.